Lloyd’s to make debut in debt markets

The world’s oldest insurance market is taking its first steps into the debt market as Lloyd’s announces plans to raise 500 million pounds in long-term subordinated debt.The move accompanies other strategies to finance the Society of Lloyd’s central fund, notes CEO Nick Prettejohn. Lloyd’s has also asked for direct contributions from members and set up a new syndicate loan arrangement for 2005. Of the debt issue, which will be listed on the London Stock Exchange, he says, “we believe there is currently a good appetite for this type of issue in the capital markets”.Terms of the issuance have not been finalized, however rating agencies are already reacting, with A.M. Best assigning a “bbb+” rating to the notes, and an “a-” issuer rating to the Society. Standard & Poor’s and Fitch are expected to assign “BBB+” ratings to the debt notes, Lloyd’s comments.